Floating a private company Assignment - Essay Example

The pros and cons of this action involve alternative invest market, which holds the association of a high power that allows companies to have an opinion in tailoring of rules especially to those that have less accountancy history. However, there could be a possibility of lack of competence that is based on high substantive uncertainty especially with regard to incomplete information. London stock exchange gives an opportunity for the market to be open –ended. Nevertheless, it is argued that forth coming profit can be misused by the stalk holders.

Floating any company provides a public price for its shares and an institutional market for trading especially its shares thereby granting ease with which a security can be traded on the market (Neale and Pike 2009). The principal factor considered when floating a company is to raise capital. Putting Tenpin in the market through floating means that the public is in a position to buy and have shares with the company (Arnett 2011). There are several practices and procedures that are required by Tenpin in order to gain authorization to float.

This has emerged from the board of directors; the Ball family decisions based on the fact that they had been denied by their bankers. Due to this, the company has opted for a place in the main market of the London Stock Exchange. First and foremost, is that floating in UK dictates that a company must get authorization from the UK Securities Commission in order to make a public order (Becket 2012). In essence, the company must be able to abide by the legal and regulatory standards that have been set for public limited companies which involve a minimum share capital of £50,000 where by a quarter of the money must be paid before commencing of the stock exchange (Neale and Pike 2009).

The company’s yearly financial reports must abide with those in the London Stock Exchange. Moreover, the company must comply with the rules and regulations of